Top 10 steps to prepare before buying your first home

Buying your first home in Rosebery means getting your paperwork, finances, and eligibility sorted before you start inspecting apartments.

The checklist below walks you through what to prepare, what to check, and what to ask before you make an offer. Each step builds on the one before it. Miss one and you'll likely need to backtrack later.

Check your eligibility for stamp duty concessions and government support

New South Wales offers a full stamp duty exemption on properties up to $800,000 and a sliding concession between $800,000 and $1,000,000 for eligible first home buyers. You can also access the Australian Government 5% Deposit Scheme with no income cap and no annual place limit, allowing you to purchase with a 5% deposit without paying lenders mortgage insurance.

Consider a buyer looking at a two-bedroom apartment in Rosebery. At the suburb's current median, they would qualify for either full or partial stamp duty relief depending on the specific property price. If they have a 5% deposit saved, they could apply through one of 31 participating lenders under the government scheme. The combination removes two of the largest upfront barriers: stamp duty and the cost of lenders mortgage insurance.

You cannot combine the 5% Deposit Scheme with the Help to Buy program, but you can use it alongside state concessions. Eligibility for the stamp duty exemption requires that you have not previously owned property in Australia and that you intend to live in the home as your principal place of residence for at least 12 months from settlement.

Work out your borrowing capacity and deposit position

Your borrowing capacity depends on your income, existing debts, living expenses, and the lender's assessment rate. Before you start looking at properties, calculate what you can borrow and what deposit you have available.

If you are planning to use a 5% deposit under the government scheme, factor in settlement costs including conveyancing, building and pest inspections, and any strata report fees. These can add several thousand dollars to your upfront costs even when stamp duty is waived.

Gift deposits are accepted by most lenders but require a signed declaration from the person providing the funds. The lender will want to confirm that the gift is not a loan and does not need to be repaid. If you are receiving help from family, arrange that confirmation early so it does not delay your application.

Gather the documents you need for a home loan application

Lenders assess your application based on proof of income, savings history, identification, and existing liabilities. The documents you need depend on how you earn your income.

If you are a PAYG employee, you will need recent payslips, tax returns, and bank statements showing your savings pattern over at least three months. If you are self-employed or earn income from multiple sources, lenders typically ask for two years of tax returns, business financials, and accountant-prepared statements.

Your savings need to show genuine accumulation rather than a sudden deposit. Lenders distinguish between funds you have saved over time and funds that appeared in your account recently without explanation. If your deposit includes a gift, bonus, or sale proceeds from another asset, document the source clearly.

Apply for pre-approval before you start looking seriously

Pre-approval gives you a clear borrowing limit and shows sellers that you are ready to proceed. It is not a guarantee, but it means a lender has assessed your financial position and confirmed the amount they are willing to lend subject to property valuation and final checks.

Pre-approval is valid for three to six months depending on the lender. If your circumstances change during that period, such as a change in employment or an increase in debt, you must notify the lender. The approval can be withdrawn if the information you provided is no longer accurate.

In Rosebery, where apartments sell quickly and competition can be strong, having pre-approval in place means you can move faster when you find the right property. It also helps you avoid wasting time on properties outside your budget.

Understand the difference between fixed and variable rates

A variable rate moves with the market and gives you access to features like an offset account or unlimited additional repayments. A fixed rate locks in your repayment amount for a set period, usually between one and five years, but limits your flexibility during that time.

Some buyers choose a split loan, fixing part of the balance and leaving the rest variable. This approach provides some protection against rate rises while retaining access to flexible repayment features on the variable portion.

Your choice depends on your risk tolerance, repayment strategy, and how long you plan to hold the property. If you expect your income to increase or want the option to make large lump sum payments, a variable rate or split structure may suit you better than a fully fixed loan.

Compare loan features that match how you plan to repay

An offset account reduces the interest you pay by offsetting your savings balance against your loan balance. If you maintain a healthy buffer in your transaction account, an offset can save you thousands of dollars over the life of the loan.

A redraw facility lets you access any extra repayments you have made above the minimum. Not all lenders offer both features, and some charge fees for redraw access. If you plan to pay extra when you can and want the option to pull that money back out in an emergency, check the redraw terms carefully.

Some home loan options come with annual fees, monthly account keeping fees, or fees for additional repayments on fixed loans. Add these up over the life of the loan and compare them against any rate discount the lender is offering.

Factor in ongoing costs beyond the mortgage repayment

If you are buying an apartment in Rosebery, you will pay quarterly strata levies that cover building insurance, common area maintenance, and the sinking fund for major repairs. Strata fees vary widely depending on the age of the building, the facilities included, and how well the body corporate has planned for future work.

You will also pay council rates, water rates if the property is not individually metered, and contents insurance. Lenders require building insurance, but in a strata scheme that is covered by the owners corporation and included in your levy.

Before you make an offer, request a copy of the strata report and check the levy amount, the balance of the sinking fund, and any planned or ongoing major works. A building with low levies but an empty sinking fund may be about to hit owners with a large special levy.

Know what happens after your offer is accepted

Once your offer is accepted, you exchange contracts and pay a deposit, usually 5% to 10% of the purchase price. The contract will include a settlement date, typically four to six weeks later, and any special conditions such as finance approval or building inspection.

Your lender will order a valuation to confirm the property is worth what you are paying. If the valuation comes in below the purchase price, the lender will base your loan on the lower figure and you will need to make up the shortfall with additional deposit or renegotiate the price.

Your conveyancer will handle the legal work, including title searches, contract review, and settlement. They will also calculate any adjustments for prepaid strata levies or rates and arrange the transfer of funds on settlement day.

Plan for what you can control and get advice on what you cannot

Rosebery sits close to the University of New South Wales, Green Square, and the airport employment precinct, which has made it a popular choice for first home buyers who work in the city or the eastern suburbs. The suburb has a mix of older low-rise blocks and new developments, and property prices reflect the location and the age of the building.

You cannot control interest rate movements, but you can control how much you borrow, the deposit you save, and the loan structure you choose. You cannot predict what a property will be worth in five years, but you can make sure the repayments are manageable even if rates rise or your income changes.

Call one of our team or book an appointment at a time that works for you. We will walk through your financial position, explain your low deposit options, and help you structure a loan that fits how you actually plan to use it.

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